Mozambique’s Japanese investment beacon – with Takashi Masuda, Mitsui

FurtherAfrica chatted with Takashi Masuda, Mitsui’s Country Manager in Mozambique to hear how the Japanese equity powerhouse has been developing its businesses in the country gaining ground in key sectors of the economy.

Fabio Scala:
Masuda San, thank you very much for taking the time to talk to us today. It is always a pleasure to see you. Very often I come across people who are not aware of your group’s diversity and reach, so if you don’t mind, let’s begin with Mitsui’s “360°” narrative. Could you briefly introduce the Mitsui?

Mr. Takashi Masuda:
Thank you very much, Fabio san. You are always most welcome. Mitsui is one of the biggest Japanese trading and investment houses, or “Sogo-Shosha”. It is a unique business model that can be seen only in Japan, in which extremely wide range of products, services and projects are being handled under the same entity, unlike other trading or investment firms outside Japan.

Since its foundation in 1876, although the entity’s legal continuation was once cut in 1947, over the course of history, Mitsui has followed a mission of providing essential products and services not only in Japan, but also in all over the world. And in serving this mission, we have connected nations, people, businesses, technology and ideas to create and innovate new values. Currently (as of 31 Mar, 2018), we have a network in 66 countries and regions with 137 offices and trading affiliates, 472 companies for consolidation, and more than 42,000 thousands of employees (on consolidated basis) globally.

Mitsui has variety of business areas, such as energy, metals, chemicals, machinery & infrastructure, lifestyle and innovation & corporate development (IT, finance and logistics). Across this wide range of industries, Mitsui has been providing solutions to the partners and customers around the globe. It is said sometimes that “Mitsui is people”, because they are recognizing the diverse Mitsui professionals that have individually and collectively created new values around the world. We are very proud of these words.

Fabio Scala:
With all of these investments all over the world, I hear that Mozambique is one of the key markets for the group. Could you tell us a little a bit the history of Mitsui in the country?

Mr. Takashi Masuda:
Mitsui’s history in Mozambique goes back to 1967-1968, when the country was not yet independent and the current capital city Maputo was used to be called Lourenço Marques. At that time, we had handled some trading business.

The next milestone was in 1985, when we opened our representative office here in Maputo. Even during the period of Mozambican Civil War, Mitsui maintained its presence and conducted ?business activities, contributing to meet the needs of Mozambique’s development, in conjunction with the Japanese Official Development Assistance (ODA) program. The business area which we focused in ODA-related business was importing fertilizer, pesticide, and agricultural machines from Japan, importing rice from Thailand, etc.

We paid close attention to Mozambique, as the country started to give a glimpse of its huge potential growth in the area of natural resources, namely natural gas and coal mining, among others. And following such context as well as in consideration of our strategic commodity /partnership and geopolitical portfolio, we re-opened our office in Polana Hotel in March, 2011 and in April 2013 we moved to our current location.

Fabio Scala:
That’s quite a history. And what are the main projects Mitsui is currently involved in Mozambique?

Mr. Takashi Masuda:
Currently we have two mega projects; one is the Area 1 LNG project, the other is the Moatize coal mine and Nacala infrastructure project.

Firstly, I wish to explain briefly about the LNG project in Cabo Delgado. Mitsui has 20% share through its subsidiary (Mitsui E& P Mozambique Area 1 Limited) in the Area 1 consortium, whose operator is US oil & gas company Anadarko. Mitsui joined this project in 2008 from the exploration phase. It is confirmed that this area has approximately 75TCF of recoverable natural gas resources, which is equivalent to more than 15 years of whole demand for LNG in Japan. We believe that this project will contribute to the global energy security, taking Mozambique’s advantageous geographic position into account, which has a good access to major areas of demand for gas like Far East, Asia, Europe and Latin America.

Now, let me talk about Moatize coal mine and Nacala railway/port infrastructure project. Mitsui and Vale, a Brazilian mining major, have structured a strategic partnership through several projects such as iron ore mining in Brazil, and in December 2014 we agreed to obtain 15% of Vale’s stake in Moatize mine and 50% of railway/port infrastructure.

Moatize mine has more than 400 million tons of coal reserve, and the mine life is estimated to be more than 20 years, being one of the largest coal mine in the world with the reserve of high quality coking coal and thermal coal.

Nacala Logistic Corridor railway has a length of 912km from Moatize to Nacala Port, and has a transportation capacity of 22 mil tons per annum, in which 18 mil tons are designated for coal transport and 4 million are for general cargo.

Our goal in relation to this infrastructure is not only to transport the coal from Moatize to Nacala, but also to contribute to the economic growth of hinterland countries such as Malawi and Zambia, in addition to the entire regions of Nacala Corridor through transportation of general cargo.

Fabio Scala:
Can you tell us what are the other areas/activities you are getting involved?
Or what you see Mitsui developing in the foreseeable future?

Mr. Takashi Masuda:
Our approach towards business and other activities in Mozambique is always for the contribution to the inclusive and sustainable growth of the country, through creation of core industry of the country, installation of high-quality infrastructures and capacity building, etc. and we are getting involved in several activities in this sense.

For example, we believe the agricultural sector is one of the promising and necessary business areas to sustain Mozambican economy in the future. Last November we announced our participation in an agricultural trading company called ETG (whose head office is located in Dubai/UAE), who has ample “last-one-mile” network to small farmers of sub-Saharan Africa for more than 50 years, including offices in Mozambique.

Our intention for this investment is not only to perform the current trading of agricultural products, but also to contribute to the sustainable development of farmers, rural communities and regions by creating new solutions/innovation utilizing its network, for the growth of agricultural sector.

Furthermore, we have focused on capacity building activities related to human resource development in Mozambique to contribute to the sustainable and inclusive growth of the Nation. Mitsui understands that development of human capital is one of the priorities of the 5 year plan for 2015-2019 of the Government of Mozambique.

We have been working closely with the government and institutions of Mozambique and Japan by sharing the experience and know-how of Mitsui in developing industries such as gas value chain businesses through seminars, workshops, site visits, internships and scholarships.

One of the example of public and private partnership in this area is “ABE Initiative”, which is a Japanese governmental initiative to provide opportunities for African talented youth (who had graduated from university) to study in Japan to obtain master course, and have internship in Japan as well, in order for them to bring and feedback the acquired knowledge to their home countries’ growth. Mitsui is a member of Steering Committee of this Initiative, and we support JICA (Japan International Cooperation Agency), Embassy of Japan in Mozambique and concerned Mozambican Ministry in the selection process of Mozambican candidates and in receiving internship at our headquarters in Tokyo.

Another example is that Mitsui recently decide to donate 2,500 soccer balls to Ministry of Youth and Sports which shall be distributed to elementary schools, mainly in Cabo Delgado Province. The main objective is to promote healthy and sound growth of Mozambican young generation.

Fabio Scala:
Finally, what would be your advice for Japanese companies and entrepreneurs contemplating an investment in Mozambique?

Mr. Takashi Masuda:
I would like to emphasize that Mozambique is a country of huge potentiality for future growth. The country has enormous reserves of various natural resources, vast and fertile land, and a 2,900km long coastline, which provides hinterland countries with connections to the overseas market.

As I mentioned before, its geographic position is strategically advantageous, considering an ideal access to every fundamental economic region around the globe. Furthermore, Mozambique’s young and ample human resource will certainly be a driving force of the future economy progress.

Lastly, I would like to emphasize three important aspects to you.

(1) Mozambican character is generally gentle and warm-hearted.

(2) Mozambican food is so delicious for Japanese (as well as all nationalities) and I do believe that Mozambican seafood and chicken are the best in the world.

(3) Japan and Mozambique has long historical relationship with more than 430 years. First Mozambican called Yasuke visited Japan with Portuguese mission in 1581. Since then, the two countries crossed several times in the course of history, and in 2017 it was celebrated the 40th year of diplomatic relationship.

I do hope that more and more Japanese business people visit Mozambique and become fans of this interesting and attractive country. We Mitsui commits to the further prosperity of Mozambique with the long term vision on win-win basis.

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